Push for upscale housing, timing limited developers

The city of Redmond’s recent pursuit of developers for its old city hall property fell short, with only one proposal submitted after a nearly two-month search.

The process began in June, when a subcommittee of Redmond’s downtown urban renewal advisory group sent invitations for project proposals to nearly 150 developers, real estate professionals and others. A tour of the property in the core of downtown Redmond took place June 21 and the deadline to submit proposals was July 27.

Only one was submitted, and local developers say the city’s preference for high-end housing at the site was a factor.

“We remain optimistic that an upscale housing project has great potential as a re-use for the old city hall site,” Chuck Arnold, the city’s economic development/urban renewal program manager, said in an email. “This is simply the next step in the process as we seek the best partner for the redevelopment.”

Redmond’s Urban Renewal Agency — which is directed by the City Council — purchased the former city hall property from the city in January for $1.3 million. Its plan was to demolish the city hall building and redevelop the site as a private partnership, according to The Bulletin archives. Redmond moved its city hall to the remodeled Evergreen School building in the spring.

The subcommittee chose not to move forward with the only proposal that was submitted as it “did not meet some essential required criteria in the (request for proposals) including Financial Capacity and Financial Terms Proposed,” Arnold said.

The city of Redmond refused to release a copy of the proposal, citing protocol that requires confirmation from the developer.

Multiple developers who were invited to submit proposals said that the project was not something they typically pursue. Patrick Brady, of Ezra Terra, said his company focuses on contaminated buildings and the old city hall property just wasn’t a project they were looking at.

One of the main concerns of developers is the city’s desire to turn the property into upscale housing, though the city struggles with affordable and low-income housing.

“Generally, the rent levels were too high,” said Mark Smuland, development consultant with Development Strategy & Management, a Bend-based real estate strategy and project management company. “They want to see higher-end housing going in there but there isn’t really a market for that in Redmond right now.”

The timing of the project could also be a factor, he added, as developers are busy in the summer months. Smuland also suggested later reopening the project to proposals for low-income housing as well.

“They need to establish if there is a desire for high-end housing and if people are willing to pay that higher rent,” Smuland said. “What they are doing in downtown Redmond is really fantastic stuff and I think if they put affordable housing there it would do really well. There’s always a need for it.”

The subcommittee will meet with the full urban renewal advisory committee to discuss the next steps in the process in a meeting at 5 p.m. Monday at City Hall.